Have you received a Discovery Assessment letter from HMRC?
Are you worried about the implications and the tax and penalties you might need to pay? Contact Churchill Tax Investigations for advice on your options and how to deal with the Discovery Assessment.
Using Section 29 of the Taxes Management Act 1970, HMRC is able to challenge the information provided on a tax return. There are specific conditions that must be satisfied and deadlines which must be reached when it comes to a Discovery Assessment. A discovery assessment can only be used in certain situations:
Four years after the end of the tax year where a tax return has been submitted and there hasn't been sufficient disclosure
Six years after the end of the tax year for loss of tax which resulted in carelessness
Twenty years after the end of the tax year if the loss of tax resulted from a deliberate error
If you receive a Discovery Assessment Letter, it will quote Section 29(1) of the Taxes Management Act 1970, HMRC believe that you have under paid your tax or you have received too many reliefs in terms of tax. It is strongly recommended that you consult a specialist tax advisor before you reply to this letter.
Discovery Assessments Explained
A discovery assessment may be issued if income has not been declared, tax has not been assessed properly or if excessive reliefs have been awarded. These are often associated with offshore accounts because they are harder for HMRC to locate. A discovery assessment may be launched if one of two conditions are applicable: The first condition is if the full facts were not available due to an incomplete disclosure, fraudulent or negligent behaviour by the taxpayer. The second condition applies if an officer who is completing an investigation was not reasonably aware of the tax loss.
If you have already gone through a HMRC investigation but you know that you have omitted information or you have an offshore bank account that you didn't disclose, it is vital that you contact a specialist in discovery assessment who can guide you through what to do next. If you don't and you are issued with a discovery assessment notice, you risk severe HMRC penalties and even a custodial sentence.
Our team are specialist tax investigators who have years of experience in all aspects of taxation. Churchill Tax Investigations can advise, instruct and work with clients to navigate through this complex and challenging time. Contact our team today to discuss in confidence your tax issues and we will advise you, no obligation what you can do next.